Facing one of Europe’s toughest regulated market conditions, Italian operators have continued to face a political whiplash during the pandemic. In addition to a steep series of tax increases in 2019 and a blanket ban on gambling advertising, a turnover tax applying to all sports betting related business forms part of the government’s Re-launch Decree to help Italian businesses recover from the Covid-19 crisis.
Ahead of his appearance at SBC Digital Italy, Pietro Lechiara, Managing Director Italy at Betsson Group, explains why operators and key stakeholders need to unify forces in order to combat misguided preconceptions and negative perceptions of the gambling industry.
Several years on from the Dignity Decree imposing a blanket ban on gambling advertising, how has Betsson Group adapted its strategy to market its services in Italy?
Betsson has created one of the most popular brands in the industry in Italy standing out from the crowd thanks to our innovative marketing campaigns. Therefore, the advertising ban was a disruptive event since marketing was crucial for our growth in the market. Luckily, at Betsson we are used to thinking fast and acting even faster.
Our strengths in Italy can be summarised as follows: customer centricity, creating value through entertainment, contents, and experiences.
We therefore created an entertainment company called StarCasinò Media & Entertainment, with whom we launched StarCasinò Gratis, the first casino for fun in Italy, and StarCasinò Sport, a sport-related media. Launching these two entertaining brands was already part of our plans for Italy, even before the ban. The Dignity Decree just speeded things up.
Despite the prohibition of sports sponsorship, are the reappearance of operator ‘information sites’ and creative sports partnerships effective? Are they purely a short-term gain until the authorities act again?
I think that in 2021, pure visibility can’t be effective, especially if it is not linked directly with your business.
As mentioned, the launch of our website was already in our plans for Italy. We were used to entertaining football fans with content and activations, and StarCasinò Sport was built following this path. StarCasinò Sport is not an informative website like the others, we call it “a media of sports entertainment”.
Our goal was to entertain football fans with fresh, exclusive, and surprising content pieces and other initiatives. A few months after its launch we managed to sign-up three major partnership with AC Milan, Inter, and Napoli.
We got several million interactions on Facebook and Instagram and we are considered one of the top five fastest growing sports channels on YouTube. We are achieving what we planned to achieve, and more. Honestly, I don’t know what the end-goal of the other operators in the market is, so I can only speak about our experience.
Do retail brands still have an advantage when it comes to brand awareness?
Under the advertising ban regime, having betting corner or any other land-based presence is of course an advantage. Pure online operators cannot show their brands or offers aside from their proprietary websites. A shop’s sign is like a small advertising billboard and is certainly a powerful tool for brand awareness. Moreover, in-shop activities can be helpful to acquire, engage and retain customers.
2020 was a tough year for retailers due to the restriction related to the pandemic, but the majority of operators in Italy reacted promptly to improve their online experience and offer an omni-channel customer journey. I think in the future it will be all be interconnected in each and every touch point.
Last year, the Italian government introduced a decree making it tougher for illegal online gambling providers to access the market. Has Article 27 of the Decreto Agosto been a success? Is enough being done to prevent Italian players accessing unlicensed platforms and unregulated games?
It is something, but not enough. It will never be enough until the licensed operator is treated the same as the illegal one in terms of communication. We need to be the only option for potential players, because we are the safest choice.
We make a lot of effort in delivering a safe environment for customers on our platform. We encourage responsible gaming practices in every market and last year we were awarded for being a responsible operator on multiple occasions, including in Italy. We also make stringent checks and balances on a daily basis related to AML.
I’m saying all of this because it is important to create clear rules and guidelines – to lead the responsibility of licensed operators is the right solution to protect customers on every level, and prevent them from the behavioural, health and monetary risks from illegal websites.
In addition to a steep series of tax increases in January 2019, a turnover tax applying to all sports betting related business forms part of the government’s Decreto Rilancio (Re-launch Decree) to help Italian businesses recover from the Covid-19 crisis. Is this fair on the industry? Do you expect this ‘temporary’ tax to ever go away?
According to the latest information we have is that the last payment of this tax should be in February 2022. We hope that this will be not extended as otherwise it will be a decision which goes beyond the reasons and scope it was originally introduced. I don’t want to judge whether it is fair or not, but our industry in Italy needs to be reconsidered in several respects when it comes to regulation and taxes.
As the turnover tax was imposed, an appeal to the government to lift the advertising ban, even temporarily, to recoup some losses was denied. Why does the government take such a hardline stance to gambling? Is the government using the health emergency to bring the legal and public gaming industry to its knees?
To be honest I don’t think that this rejection was a surprise to anyone. One must keep in mind that a large chunk of the government’s coalition had gone against gambling as one of their main points in the electoral programme.
In this specific case, they were consistent with their pre-election promises. I would prefer that we open a wider discussion setting clear guidelines of responsible adverting instead of a blanket ban. Many people wish to have regulation like the one adapted for the alcohol industry in Italy, and I think that would be a really good starting point.
How, if at all, can operators and key stakeholders change the mindset and political will of legislators?
Good question! First of all, we need to unify forces and present ourselves as a single voice that represents an important industry, and subsidiary for our country.
A close second is education. There is some serious lack of knowledge about the gambling industry – it’s made up by misguided preconceptions and negative perceptions rather than based on real facts and data. We are ready to discuss, co-operate and find the best solution for our beloved country.
Despite facing Europe’s toughest regulated market conditions, a diverse cast of foreign and domestic operators remain. As new and less stringently enforced international markets open up, do you expect the current Italian roster of operators to diminish in the coming months and years ahead?
In today’s world, everything changes quickly – from laws to markets – and it is becoming increasingly difficult to make any long-term predictions. What I can say is that we will stay, and we will continue to do our utmost to provide the best entertainment and a fun and safe environment for all the people that choose us.